SWITZERLAND

Photo by: Bergfee

Swiss Confederation

Confédération Suisse

Schweizerische Eidgenossenschaft

COUNTRY OVERVIEW

LOCATION AND SIZE.

Located in west central Europe, bordered on the north by France and
Germany, on the east by Austria and Liechtenstein, on the south by
Italy, and on the west and south-west by France, this landlocked alpine
country has an area of 41,290 square kilometers (15,942 square mi),
making it slightly less than twice the size of New Jersey. The capital,
Bern, is situated on the Aare River in the north-western part of the
country; the largest city is Zürich in the north; other major
cities include Geneva and Lausanne in the south-west, Basel in the
north, and Lugano in the south.

POPULATION.

The population of Switzerland was estimated at 7,262,372 in July 2000;
the population growth rate in that year was 0.3 percent, and the
immigration
rate was 1.38 per 1,000 population. Population density was among the
highest in Europe, at about 176 persons per square kilometer (455 per
square mile). The population is aging, and it has a high life
expectancy—79.6 years for the total population (76.73 for men,
and 82.63 for women). Consequently, the median age increased to 42.6
years in 1999 from 37.2 five years earlier. Some 15.4 percent of the
population are 14 years old and younger, and 16.7 percent are 65 and
older.

The majority of the population, about 62 percent, lives in urban areas,
and with the exception of Zürich, Geneva, Basel, and Lausanne,
mostly in small towns. Most of Switzerland is mountainous and the
population is unevenly distributed, concentrated in the valleys and the
plains.

Switzerland's ethnic composition is complex and includes 3 major
traditional language communities: German (about 64 percent of Swiss
citizens), French (about 19 percent), and Italian (about 10 percent),
along with the traditional Romansch (Rhaeto-Roman) language community
(about 1 percent). Other ethnic groups include Spaniards, Portuguese,
Turks, Albanians, former Yugoslavs, and others. Religious groups include
Roman Catholics (46 percent), Protestants (40 percent), others (7
percent), and no religious faith is reported by 7 percent. The very slow
population growth and the sizeable surplus of jobs in the economy
(particularly in the services sector) have brought in many foreign
guest workers
from Italy, Spain, Portugal, the former Yugoslavia, and elsewhere.
Guest workers are now estimated, with their families, to constitute
nearly one-fifth of the entire population.

Switzerland has been the destination for many economic immigrants and
asylum seekers, which has led to growing internal tensions. The fear of
being overrun by foreigners has been a persistent Swiss topic in
domestic political debate for decades. There have been many attempts to
limit the number of foreigners by legislative means. In 2000, the Swiss
electorate voted on a referendum to impose an 18 percent quota on the
number of foreign workers in the country. They decided against the

measure, although the supporters of the quota argued that the influx of
foreigners in the 1990s was equal to the population of the 6 smallest
(and politically most conservative) Swiss cantons (confederate units).

SERVICES

FINANCE.

Long regarded as the country of the bankers, Switzerland has a robust
finance services sector and its most vibrant components are banking and
insurance. Within the banking sector, commercial and private banks have
the largest influence and growth potential. Swiss banks have been
historically renowned for their stability, strictly enforced secrecy
policies, privacy, personalized service, and reliability. The increase
in world trade and industrial activity after World War II brought more
business to commercial banks, particularly to their global operations.
With the merger of the Union Bank of Switzerland and Swiss Bank
Corporation in 1998, the new United Bank of Switzerland (UBS) is now
Europe's second largest bank by total assets. Mutual funds and
institutional investors have also vastly gained in importance, and
represent very good growth prospects for commercial and private banks.
The insurance industry is equally important for Switzerland, and the
Swiss are by all measures the most heavily insured people in the world.
There are over 100 insurance companies, approximately 10 percent of
which specialize solely in the reinsurance business; of the latter,
Rueckversicherung is the world's second-largest reinsurance
company. Swiss insurance companies have been consistently very strong
performers with steadily growing earnings.

TOURISM.

A country of scenic landscapes and enterprising people, Switzerland has
one of the most robust tourist industries in the world, with extensive
facilities and centuries-old traditions, a sector that is one of the
leading sources of foreign exchange and employment in the economy.
Although the country is a humming crossroads between some of the
fastest-growing regions in the
EU, foreign visitors usually enjoy lengthy stays instead of simply
transiting through. Foreign tourists spent US$11.355 billion in 1998 and
over 69 million overnight stays were recorded in the sector offering
slightly more than 1 million hotel, chalet, campsite, and youth hostel
beds. Foreign tourist positive credit balance reached US$1.046 billion
in 1998, and revenue from domestic tourists exceeded US$9 billion.
Expenditures in the foreign tourist sector, including investments,
surpassed US$10 billion. The country attracted the widest possible range
of guests, from affluent elderly people visiting the spas to low-budget
young backpackers trekking or "canyoneering" across its
numerous mountains. Switzerland has a long list of world-renowned alpine
(skiing and hiking) and lakeside tourist resorts, spas, and casinos;
world-class cultural events; and many important international
organizations and conferences, drawing huge numbers of participants,
activists, and observers.

RETAIL.

The structure of
retail
trade in Switzerland has been changing since the 1980s. Independent
retailers are decreasing in number, giving way to self-service and
discount stores and supermarkets, and a tendency toward specialization
in food distribution has been particularly noticeable. Department and
chain stores, consumer cooperatives, discount stores, and supermarkets
account for a large part of local trade. The tendency in those companies
is to deal in a wide range of products and services. Their centralized
buying gives them a competitive advantage over independent retailers
(they are given a discount by suppliers due to the vast scale of their
purchases). Retail traders continue to streamline their operations in
order to counter their stiff competition. Scanner cash registers for
bar-coded articles are ubiquitous, and the use of electronic cards to
ease payment transactions is growing (cards are issued, among others, by
the Swiss Post, where numerous Swiss have bank accounts, and are
becoming increasingly popular). In 1987, Swiss retail groups united to
form an Electronic Payment System Association.

Yet, faced with the competition of large retail establishments with
nationwide coverage, individual retailers also set up organizations to
provide wholesale purchasing, importing, and other services. Functioning
as cooperatives, most of these small retailers' buying groups and
associations operate in the foodstuffs business but also in textiles,
leather goods, sports articles, pharmaceuticals, toys, and hardware.
Home shopping, or the direct sale from a private location, is becoming
increasingly popular and has recorded enormous growth. The
turnover
for direct sales companies has doubled after 1995. The home-shopping
boom has reached a record high and products sold range from Tupperware
to lingerie to new recipes and cleansing agents. More than 5,700
salespeople are members of the Swiss Association of Direct Marketing
Companies (VDF), mail order companies not included. They can count more
than 1 million client-contacts yearly, generating a turnover of US$195
million (in 1998). Most of the products sold at "Home Shopping
Parties" are top quality and innovative and cannot be found at
retail stores. The advantages of home shopping are the advice offered by
the sales persons, the relaxed and friendly atmosphere of the private
location, the combined shopping and meeting friends experience, and the
possibility of testing the products on the spot.